India pips US in smartphone connections

October 28, 2016 — INDOLINK Consulting (es)

Source: Times of India, Oct 27, 2016

New Delhi: India has become the second-biggest market globally in terms of smartphone connections, overtaking the US and trailing only China. More and more Indians are logging on the internet using their mobiles, aided by availability of low-priced smartphones — a significant number of them assembled locally and sold for as low as Rs 3,000 — and rapid expansion of 3G and 4G networks.

According to figures provided by global telecom body GSMA, smartphone connections in India at the end of the first half of this year (ending June 2016) stood at 275 million, higher than 259 million connections in the US. China, however, leads by a huge margin with overall smartphone connections at 910 million.

Alasdair Grant, the head of Asia for GSMA, told TOI that the growth in smartphone connections will continue to remain strong in coming years as 3G and 4G networks spread rapidly across the country. The growth will be fuelled further with the entry of new operators such as Reliance Jio.

Grant added that 4G connection base is forecast to grow from 3 million at the end of 2015 to 280 million by 2020. “Mobile broadband (3G and 4G) will account for nearly 50% of total connections in India by then.”

GSMA said mobile operators are investing heavily to improve network coverage, and this should see 3G being available to 90% of the population by 2020, while 4G to 70%, the latter registering a 14-fold increase from now.

Most of the mobile manufacturers have also read the trend as the majority of new device launches by them are only 3G and 4G compatible as 2G devices — which are mainly feature phones — are being discontinued.

Total mobile users in India (some may carry multiple SIM cards) stood at 616 million at the end of June, GSMA said. “Almost half of the country’s population now subscribes to a mobile service, indicating the significant growth potential in the coming years, particularly from the rural and under-penetrated segments.”

In its ‘India Mobile Economy’ report, GSMA estimates that 330 million new mobile users will be added by 2020. This would push up the mobile phone penetration base across the population to 68% against 47% at the end of 2015.

The report also said that mobile phones will also become a platform to offer a variety of government schemes and other services such as financial access, information dissemination, and productivity enhancement.

The report said that data traffic will register a CAGR of 63% between 2015 and 2020, registering a 12-fold increase over the present usage. This will be fuelled by social networking and online communication.